Money (Not) to Burn: Payments for Ecosystem Services to Reduce Crop Residue Burning

A-Tier
Journal: American Economic Review: Insights
Year: 2025
Volume: 7
Issue: 1
Pages: 39-55

Authors (4)

B. Kelsey Jack (not in RePEc) Seema Jayachandran (Princeton University) Namrata Kala (not in RePEc) Rohini Pande (not in RePEc)

Score contribution per author:

1.005 = (α=2.01 / 4 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We test whether payments for ecosystem services (PES) can curb the highly polluting practice of crop residue burning in India. Standard PES contracts pay participants after verification that they met a proenvironment condition (clearing fields without burning). We randomize paying a portion of the money up front and unconditionally to address liquidity constraints and farmer distrust, which may undermine the standard contract's effectiveness. Incorporating partial up-front payment into the contract increases compliance by 10 percentage points, which is corroborated by satellite-based burning measurements. The cost per life saved is $3,600–$5,400. The standard PES contract has no effect on burning.

Technical Details

RePEc Handle
repec:aea:aerins:v:7:y:2025:i:1:p:39-55
Journal Field
General
Author Count
4
Added to Database
2026-01-25